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Tuesday, April 4, 2017

Keep Your Business Model Simple Silly!

Complexity can kill a business model quickly. When it comes to making money simplicity is king in business model design. The best companies run a simple model and continue to improve on that model over time. They focus on their model and continue to develop their efficiency and effectiveness leading to greater sales and profits. A few aspects of a simple model are below:

1.) A simple idea run over and over until it is perfected.
2.) It allows you to compete because you keep improving your model.
3.) Think of your inputs, conversion of the product/service, and your output.
4.) Once you have perfected your model you can add more products and services within that model.
5.) Continue to work on the price, cost, processes, and efficiency of the model until it works.
6.) Stay focused on a simple design because you can adjust when necessary.

Think of how a business operates. They buy a product, apply a markup and sell. They should focus on finding lower cost suppliers, pricing according to what the market can bear, and then learn to be the best at selling. The business is essentially supplier and advertising. The other details are used to enhance the model but the model stays the same regardless of the size.

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